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Tata Steel Signs Technical Agreement with Nippon Steel

Jamshedpur, February 18, 2002

Tata Steel announces the signing of a technical agreement with Nippon Steel Corporation which will take Tata Steel's cold rolled automotive steels into the market for the highest end applications, the most sophisticated customer segment that any steel producer can aspire to serve. The agreement was signed by Mr B Muthuraman, Managing Director, Tata Steel, and Mr I Koyama, Representative Director & Executive Vice-President, Nippon Steel Corporation.

Tata Steel is already serving the ever growing sophisticated steel market for the Indian auto majors such as Ashok Leyland, Telco, Hyundai, Mahindra & Mahindra etc. the steels are under test by others.

High quality sheets for automobile industry is a very important component of the product mix of the Cold Rolling Mill of Tata Steel. The sheets required for external panels for automobiles require high formability and adherence to strict surface quality norms. For supplies in 'coil' form, kilometers of surface without any surface defect or mark needs to be assured. Along with attaining the capability of producing this high quality material, the Company also requires to have approval from the auto majors. Generally, the auto majors like to tie up with one or two steelmakers on a long term basis.

The agreement with Nippon Steel Corporation has been designed to meet both these ends. It is important to realise that the quality of Cold Rolled Sheets for Auto Application is influenced by the long chain of up stream processes such as quality of hot metal used for steelmaking, the primary and secondary steelmaking processes, casting operation, inspection and dressing of cast slabs, the hot rolling practice and finally the cold rolling and annealing processes. Accordingly, the scope of the agreement starts with pre-treatment of hot metal down to Cold Rolling and Annealing practices. The External Processing activities have also been included to exclude deterioration of quality during the last and final stage of manufacturing.

The products included for this agreement are:

  1. Cold rolled sheets of DQ, DDQ and EDD Q grades of AI K and IF Steel for inner and outer panel of automotive body including high strength steel sheets (upto 590 n/mm2, the current trend with the International Automakers) produced through batch annealing process at Jamshedpur.

  2. Materials for continuous galvanized products of DQ, DDQ and EDD Q grades of AI K and IF Steel for inner and outer panel of automotive body .

The scope of the agreement covers the following:

  1. Advise on investment decisions

  2. Technical Assistance in through Process Control (i.e. management of the chain of production processes).

  3. Operational Assistance in all areas which influence the production of automotive products.

  4. Training of Tata Steel personnel

  5. Technical Assistance and direct involvement of experts in obtaining approval from two automotive majors in India.

A detailed time - schedule of activities has been worked out. The duration is 36 months from the effective date of the agreement i.e. from 1.4.2002. A Steering Committee will be reviewing the progress periodically.